By FX Empire.com
Despite the improved euro sentiment in the market and the relief rally seen most of the week the EUR/CHF still ended last week with a decline even after recovering from earlier lows.
The franc is recovering the losses endured in the previous week as the speculation that the SNB will move again and raise the floor set for the EUR/CHF eased, helping the franc regain some momentum especially amid the uncertainty over the outlook even if the debt woes ease.
With the weakening chances for the Swiss National Bank to move on the set 1.20 floor for the pair the gains for the pair might be readjusted, especially as the confidence in the euro area leaders to contain the crisis did not erase the mounting fiscal problems in the euro area and the challenging outlook which still deprives the euro of risky demand against a still haven franc.
This week the pair will continue to fluctuate heavily and might resume the tight ranged bearish bias as investors grow more cautious ahead of the EU Summit and the announcement of how the leaders plan to help Greece and capitalize banks.
Investors need more details on how the euro area will contain the crisis and until clear measures are presented the market will remain volatile especially as the global data this week from China all the way to the United States will refocus the sentiment on fragile growth and accordingly fueling more market volatility.
Other news from the euro area and the Swiss economy to affect the pair this week:
Monday October 17:
No data is due for release from both nations which will leave the focus on the sentiment and the ongoing developments in the euro area to contain the debt crisis.
Tuesday October 18:
The euro area Zew Economic Sentiment for October is due at 09:00 GMT which is not likely to have improved from September’s -44.6.
Wednesday October 19:
The euro area will release the August Current Account at 08:00 GMT where the deficit might have narrowed from -12.9 billion in seasonally adjusted terms after the trade deficit narrowed.
At 09:00 GMT the Construction Output for August is due after it rose 1.4% in July and was higher 1.2% on the year.
Thursday October 20:
Switzerland will start the day at 06:00 GMT with the Trade figures for September where the nation suffered the weak global demand and franc’s rally that affected its exports heavily. The trade surplus was at 0.81 billion francs in August when exports slumped 7.0% and imports rose 0.9%.
The advanced consumer confidence for October is due at 14:00 GMT and expected to drop further to -20.0 from -19.1 in September.
Friday October 21:
The Swiss annual M3 Money Supply for September is due at 07:00 GMT after it was reported with a rise of 7.6% the previous month.
Read more Forex Market Analysis here!
